By Michael Brooks

FERC last week upheld its decision requiring Northern States Power to continue purchasing electricity from a small hydroelectric plant, maintaining that the plant does not have access to MISO’s capacity market (QM15-2-001).

In its June request for rehearing, Northern States argued that FERC erred in requiring that the company show that Twin Cities Hydro, an 18-MW qualifying facility on the Mississippi River in Minnesota, had access to MISO’s markets. The Public Utility Regulatory Policies Act allows for the termination of the mandatory purchase of electricity from a QF if the generator has “nondiscriminatory” access to the markets.

FERC presumes that any QF with capacity less than 20 MW does not have access to the markets and requires utilities seeking to eliminate QF obligations to prove otherwise. In its May 14 order, FERC ruled that while Twin Cities had been selling power in MISO’s energy markets, it could not access the RTO’s capacity market. (See Ruling Denies Northern States’ Request to Halt Hydro Purchases.)

In its rehearing request, Northern States said the law “does not require a showing that the QF currently has met the requirements to sell its capacity into a market or a showing that the QF has had a history of sales. It simply requires a showing that the QF is on a level playing field with other facilities to establish nondiscriminatory access.”

It said FERC’s May 14 order allows Twin Cities, which is owned by Brookfield Renewable Power, to “sit on its hands and then be allowed to take advantage of the purchase requirement through its inaction.”

FERC was not persuaded by the arguments.

Northern States “has acknowledged that the Twin Cities QF cannot, at present, access the MISO capacity market,” FERC said. “The evidence presented by [Northern States’] own witness explained that, if Twin Cities were to submit a network resource interconnection service request, MISO would likely grant Twin Cities only conditional service, pending completion of several transmission network upgrades.”

The commission said the law requires that Twin Cities have “access to the specified markets and not merely that the Twin Cities QF is no more disadvantaged than any other sellers seeking to sell in such markets.”

Northern States also argued that FERC erred when it said that the company had to show access to an organized market, rather than merely a wholesale market.

The commission said no such thing, FERC said. Northern States’ “strawman argument that the May 14 order made such a finding — when, in fact, it did not — is thus without merit.”